[Senate Hearing 113-909]
[From the U.S. Government Publishing Office]


                                                      S. Hrg. 113-909

                         TRUST YOUR INSTINCTS?
                      TOOLS TO EMPOWER SENIORS TO
                        IDENTIFY SCAMS AND FRAUD

=======================================================================

                                HEARING

                               BEFORE THE

                       SPECIAL COMMITTEE ON AGING

                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS


                             SECOND SESSION

                               __________

                         INDIANAPOLIS, INDIANA

                               __________

                             AUGUST 5, 2014

                               __________

                           Serial No. 113-28

         Printed for the use of the Special Committee on Aging
         
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]         


        Available via the World Wide Web: http://www.govinfo.gov
        
                               __________

                                
                    U.S. GOVERNMENT PUBLISHING OFFICE                    
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                       SPECIAL COMMITTEE ON AGING

                     BILL NELSON, Florida, Chairman

ROBERT P. CASEY, JR., Pennsylvania   SUSAN M. COLLINS, Maine
CLAIRE McCASKILL, Missouri           BOB CORKER, Tennessee
SHELDON WHITEHOUSE, Rhode Island     ORRIN G. HATCH, Utah
KIRSTEN E. GILLIBRAND, New York      MARK KIRK, Illinois
JOE MANCHIN III West Virginia        DEAN HELLER, Nevada
RICHARD BLUMENTHAL, Connecticut      JEFF FLAKE, Arizona
TAMMY BALDWIN, Wisconsin             KELLY AYOTTE, New Hampshire
JOE DONNELLY, Indiana                TIM SCOTT, South Carolina
ELIZABETH WARREN, Massachusetts      TED CRUZ, Texas
JOHN E. WALSH, Montana
                              ----------                              
                  Kim Lipsky, Majority Staff Director
               Priscilla Hanley, Minority Staff Director
                         
                         
                         C  O  N  T  E  N  T  S

                              ----------                              

                                                                   Page

Opening Statement of Senator Joe Donnely, Committee Member.......     1

                           PANEL OF WITNESSES

Honorable Andre Carson, Congressman, State of Indiana, 
  Indianapolis, Indiana..........................................     3
Joyce Walker, Daughter of Scam Victim, Hartford City, Indiana....     4
Honorable Greg Zoeller, Attorney General, State of Indiana, 
  Indianapolis, Indiana..........................................     6
Cynthia Mormon, Assistant Inspector in Charge, U.S. Postal 
  Inspection Service, Detroit, Michigan..........................     8
Mandla Moyo, Community Outreach Director, Indiana AARP, 
  Indianapolis, Indiana..........................................    10
Mark Lindenlaub, Executive Director, Thrive Alliance, Columbus, 
  Indiana, and Board President, Indiana Association of Area 
  Agencies on Aging, Indianapolis, Indiana.......................    12

                                APPENDIX
                      Prepared Witness Statements

Honorable Andre Carson, Congressman, State of Indiana, 
  Indianapolis, Indiana..........................................    31
Joyce Walker, Daughter of Scam Victim, Hartford City, Indiana....    32
Honorable Greg Zoeller, Attorney General, State of Indiana, 
  Indianapolis, Indiana..........................................    37
Cynthia Mormon, Assistant Inspector in Charge, U.S. Postal 
  Inspection Service, Detroit, Michigan..........................    40
Mandla Moyo, Community Outreach Director, Indiana AARP, 
  Indianapolis, Indiana..........................................    47
Mark Lindenlaub, Executive Director, Thrive Alliance, Columbus, 
  Indiana, and Board President, Indiana Association of Area 
  Agencies on Aging, Indianapolis, Indiana.......................    49

 
                         TRUST YOUR INSTINCTS?
                      TOOLS TO EMPOWER SENIORS TO
                        IDENTIFY SCAMS AND FRAUD

                              ----------                              


                        TUESDAY, AUGUST 5, 2014

                                       U.S. Senate,
                                Special Committee on Aging,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:37 a.m., in 
the Farm Bureau Building Banquet Hall, Indiana State 
Fairgrounds, 1202 East 38th Street, Indianapolis, Indiana, Hon. 
Joe Donnelly, Committee Member, presiding.
    Present: Senator Donnelly.

                 OPENING STATEMENT OF SENATOR 
                 JOE DONNELLY, COMMITTEE MEMBER

    Senator Donnelly. Good morning. Thank you so much for being 
here today. We are honored to be here at the State Fairgrounds. 
This is a Senate Special Committee on Aging field hearing. We 
are honored that all of you were able to come by.
    With me will be Representative Andre Carson, who is a guest 
of the committee. We have as witnesses an extraordinary panel 
that we are very, very lucky to have: Our Attorney General, 
Greg Zoeller, who has worked so hard on this issue; Cynthia 
Mormon, Assistant Inspector in Charge of the U.S. Postal 
Inspection Service; Mandla Moyo, Community Outreach Director, 
Indiana AARP; Mark Lindenlaub, Board President, Indiana 
Association of Area Agencies on Aging; and Joyce Walker, who is 
the daughter of a scam victim and who has lived through all of 
this.
    One of the things we want to try to accomplish is to make 
sure that for all Hoosier families and for all Hoosier seniors, 
that this helps to provide them with additional information to 
protect themselves, to protect their resources, so that when 
people with ill intentions try to prey on them, that they have 
the ability and the understanding of how to protect themselves 
and their families.
    I would like to start, as I said, by welcoming everyone to 
this field hearing. Today, we will focus our discussion on a 
problem of growing concern to Hoosier seniors, to law 
enforcement agencies, and to policymakers at all levels of 
government, and, I would also like to thank the U.S. Secret 
Service for being here today, because they deal with these 
issues on a regular basis, as well.
    Consumer fraud and scams have been and continue to be a 
significant problem in the United States, especially among our 
growing senior populations. After a lifetime of hard work, 
seniors should have peace of mind, knowing they can enjoy their 
retirement in peace and with financial security.
    Our mission today is to empower Hoosiers to more easily 
identify and prevent common types of fraud and scams. We are 
also here to learn more about the work that is being done 
across our State to combat these schemes. To help me do that, 
we have this extraordinary panel here with us today.
    We are lucky to have them, because they bring a broad array 
of perspectives to this issue. We look forward to hearing your 
testimony from all of you on how we can better utilize the 
resources currently available to our seniors and to what 
efforts we can do to make sure that we minimize the risk of 
fraud to our seniors in the future.
    Scams and frauds, as our Attorney General will tell you and 
as all of you will, come in many forms and in many shapes and 
from many directions. They include identity theft, scams 
conducted over the phone, scams that go through the mail, 
Medicare scams, Social Security scams. By providing our seniors 
with additional knowledge and resources to identify these scams 
and fraud, we can reduce the number of victims who lose out 
financially to these often sophisticated schemes.
    The Attorney General was saying to me earlier, he said how 
hard they work on these schemes. These are not simple run-of-
the-mill operations. These take extraordinary planning and 
extraordinary effort, and, we laughed and said we wished they 
put their effort to better things than these kind of things.
    In 2010, my own congressional office at the time was tipped 
off to a misleading mailing that was sent out to seniors in the 
congressional district that I represented, asking them to 
please pay to provide their responses to Census information. My 
name was right there on the letterhead from our congressional 
district and it was assumed by many that it was from our 
congressional office. An organization called the Council for 
Retirement Security--we learned they were affiliated with 
nothing more than just an online blog. They sent surveys to 
several Hoosier seniors asking for responses and, of course, 
credit card information.
    More recently, a member of our team who is here today, her 
mom received a phone call from a stranger asking for money and 
claiming to be her grandson. In this particular case, which I 
think was quite a way to handle it, she said, ``You ought to 
behave yourself better. Talk to your parents.''
    However, people are calling our seniors, claiming to be 
sons, daughters, grandsons, granddaughters, friends, neighbors, 
needing immediate help. This common scam is known as the 
Grandparent Scam. It seeks to trick victims into believing that 
your loved one is in peril, such as in a car accident or in 
jail or having trouble returning from a foreign country. 
Whatever the excuse, the scammer convinces the victim they need 
to send money immediately, and they also need to keep that call 
a secret so that they are able to get their loved one out of 
trouble.
    One of the most important messages we hope to promote today 
is that awareness is the key to helping prevent fraud. While 
Americans are generally aware that identity theft and consumer 
fraud are on the rise, many are unaware of the scope of the 
problem. Today, we want to encourage victims to tell their 
stories about how con artists operate, how we can bring it to 
light, and how we can bring it to a greater sense of urgency, 
so, I want to thank all of you for being here.
    Congressman Carson, if you would like to say a few words.

             STATEMENT OF HONORABLE ANDRE CARSON, 
      CONGRESSMAN, STATE OF INDIANA, INDIANAPOLIS, INDIANA

    Congressman Carson. Thank you, Senator, and thank you for 
your leadership, particularly in putting this hearing together 
as presiding Chair. I want to certainly thank the panelists and 
our Attorney General and our friends in the Secret Service.
    I am very pleased to be here today, and I also want to 
thank the staff of not only our organization, but of Senator 
Donnelly's organization for holding this field hearing to 
really provide resources and trusted information to help our 
seniors protect their privacy and security. In this age of 
information and technology, we all know that we are still faced 
with many bad actors who really wish to take advantage of other 
people, so, it is very imperative that lawmakers like Senator 
Donnelly and myself and community leaders and stakeholders 
continue to examine policies that distribute information that 
will help prevent fraud in the future.
    I am honored that we have witnesses here today, 
accomplished witnesses, who are engaged in informing our 
community about how to really identify and protect themselves 
from these kinds of scams. We all know someone in our lives who 
can benefit from the tools provided here today, and perhaps we 
can do our own part by really listening and passing along what 
we learn. I hope some of us leave here today empowered on what 
to do if we or our loved ones are victims.
    These criminals succeed when we remain silent and do not 
report our experiences. As we all continue to work together to 
improve those resources, basic communication and education are 
our most powerful tools.
    I want to thank my good friend, presiding Chair and Senator 
Donnelly, for his leadership on this issue that impacts so many 
Hoosiers, so, I look forward to getting started and learning a 
lot more. Thank you, Senator.
    Senator Donnelly. Great. We are lucky to be joined by Joyce 
Walker of Hebron, Indiana, whose mom fell victim to a 
sophisticated phone scam.
    I just want to let everybody know--have a good Hoosier 
laugh, so, we got here and we said, we do not have any gavel 
for the event, so, we looked around my office and there was a 
little plaque on the wall that had a gavel on it.
    About an hour ago, we took it apart, we unscrewed it, and 
here is the gavel today.
    We are in business. I was about to give my friend, Greg, a 
call and say, do you have anything in the office you could 
bring with you?
    Joyce, if you could let us know what happened to your mom 
and how it developed.

                  STATEMENT OF JOYCE WALKER, 
        DAUGHTER OF SCAM VICTIM, HARTFORD CITY, INDIANA

    Ms. Walker. Thank you, Senator Donnelly, for this 
opportunity, and to Michelle Mayer for believing in me.
    My mother may have been 93 years old, but she was nobody's 
fool. When he called her to tell her that she had won big 
money, she was not about to fall for that. However, six weeks 
later, when he called again, she fell under his spell. When I 
caught up with her, she had written and mailed checks for 
thousands of dollars to people she did not even know. What 
follows is a brief overview of 24 pages of documentation, which 
I call, ``To Kill A Scam.''
    On August 13th of last year, our scammer hit for the first 
time. He called my mother to tell her she had won money and he 
needed her bank account information. My mother is a smart woman 
and she told him that her bank account information was none of 
his business and suggested that he call me. He did. He had a 
thick accent and he sounded like my parents' doctor. When my 
husband walked in the house and asked who I was talking to, I 
answered, ``I do not know, but I think it is Dr. Sitar.'' Boom. 
I had just dropped my parents' name.
    When I finally heard the word ``three-point-five-million 
dollars,'' I laughed at him and hung up. He called back six 
more times that evening. Each time, we would either let it ring 
or pick it up and hang up on him, but he kept calling. When we 
looked at the caller ID, it said ``J.M. Kingston.'' While 
trying to figure out who Jim Kingston was, the light bulb went 
off. This call was coming from Kingston, Jamaica.
    The next day, he called two more times and my husband 
threatened to call the police if he called again. He never 
called again, and that was the end of that, or so we thought.
    Six weeks passed, and my mother received a phone call from 
Dr. Sitar requesting a check for $2,400 for my father's care. 
She mailed it to him. Here is the check. She then received a 
call from the doctor stating that he was on vacation, could not 
cash her check, and she would have to rewrite it to his mother, 
Beverly Hagerman, and mail it to her. Mom followed his orders. 
However, she did mention this to her alert Resident Assistant 
at Wynnfield Crossing, who called me and suggested that 
something seemed fishy and maybe I should look into it.
    One call to the doctor's office confirmed that no such fees 
had been charged. I immediately called my mother's bank to stop 
payment on these checks, but Beverly Hagerman had already 
cashed her check. When I then visited my mother and looked at 
her check register, I asked her who Charlie Ugarte was. She had 
no idea. When I showed her, ``Mom, you have written a check for 
$2,000 to somebody named Charlie Ugarte,'' she said, ``Oh, that 
is a friend of Dr. Sitar's.''
    After hours of searching on the Internet, I tracked down 
Beverly Hagerman, a 58-year-old woman in Houlton, Maine, and, 
thanks to the staff at Wynnfield Crossing, who diligently went 
through the trash, we came up with a Post Office Box number in 
Silver City, New Mexico, for our friend, Charlie Ugarte, who 
turned out to be a female, age unknown.
    I was fortunate to find Beverly Hagerman on Facebook. We 
had numerous conversations on Facebook and she was checked out 
by Michelle Mayer of the Indiana Attorney General's office. Our 
scammer had identified himself to Beverly as David Anderson, 
told her she had won a car and money, gave her good reason to 
believe him, and called her on a regular, almost daily, basis. 
Scam victims like Beverly unwittingly launder money for him by 
cashing personal checks from scam victims like my mother, 
buying Green Dot Visa cards, and wiring money at his 
instruction. As I had done for my mother, I instructed Beverly 
to change her bank account numbers, get an unlisted phone 
number, set up fraud alert with the three credit bureaus, and 
never to talk to him again. She followed my instructions.
    Charlie Ugarte surfaced when her bank would not cash my 
mother's check. Upon being told that it was part of a scam, she 
replied, ``I am not a scammer. I am just trying to earn points 
to win a million dollars.'' She did take her check to the 
Silver City Police Department, where it is now laying in their 
evidence room.
    Meanwhile, because we were disrupting his plan, our 
scammer, whatever you want to call him, David Anderson or Dr. 
Sitar, was not receiving his money, so he actually called 
Beverly's bank in Bangor, Maine, where he became very 
belligerent with the bank's vice president. Not gaining any 
ground there, he called the Houlton, Maine Police Department, 
told them they needed to arrest Beverly Hagerman, a scammer and 
a money launderer who owed him money. The police were 
skeptical, but did take a frightened Beverly in for 
questioning. Fortunately, she had already had Michelle Mayer 
and the Indiana Attorney General's office on her side.
    I have filed complaints with the Federal Trade Commission 
and the FBI. If anybody wants to help me get this guy, thanks 
to Beverly and Facebook, I have the names of five of his 
receivers and I even have their pictures off of Facebook, and 
they all live in Jamaica.
    I have learned numerous lessons from this incident. A few 
examples are: One, scammers are slick. If they get your money, 
you will not ever see it again. Be careful who you talk to on 
the phone. Get an unlisted number. Never pay a bill without a 
written statement. Never cash a check from someone you do not 
know.
    Two, take charge of your aging loved ones' financial 
matters sooner than later. Use your Power of Attorney, watch 
their check registers, and get to know their doctors, bankers, 
and caregivers, and, three, we usually think to report scams to 
our local police departments. Police officers need to be 
equipped with the information that they will pass on that we 
need to not go to them but to State Attorney General's office 
or the AARP.
    Senator Donnelly. Thank you very much.
    We are blessed to have an Attorney General in our State, 
Greg Zoeller, who has been a tremendous advocate for seniors, 
who has worked very, very hard to protect the people of our 
State, and I would say there is no State that has been better 
served in this area than our own. Attorney General Zoeller.

         STATEMENT OF HONORABLE GREG ZOELLER, ATTORNEY
        GENERAL, STATE OF INDIANA, INDIANAPOLIS, INDIANA

    Mr. Zoeller. Thank you, Senator, thank you, Congressman 
Carson, and, particularly for having this hearing and helping 
us raise attention to this, I would say, very important issue.
    You know, we try in the State and local levels to do as 
much education and outreach as we can, but I do think that the 
role you play in raising the profile and bringing statewide 
attention to this is something that we all on this panel 
appreciate, so, again, thanks for your convening this and being 
here.
    I will dispense with reading my formal remarks. I will 
submit that. I know how the Senate operates, so I will--maybe I 
can revise and extend my remarks later----
    Senator Donnelly. If there is a way to talk longer, we 
usually find it.
    Mr. Zoeller. I will shorten this, just to make a few 
comments.
    First, we have got some statistics to share to show the 
extent of this problem, so, you will hear a number of examples. 
We all have as many as you want to listen to, but, we have 
statistics in terms of the number and the type, so we can 
present that for your information.
    I think it is critical to recognize that the focus on 
seniors is because of their vulnerability. My office has always 
focused on the most vulnerable in our State, so whether it is 
children, whether it is recent immigrants, people in financial 
trouble, anyone who shows some vulnerability. The last time we 
were together, we were talking about military servicemen and 
women and the families when they leave to be deployed, so, 
again, scam artists focus on the vulnerabilities of people.
    Combined with that, seniors often have resources in their 
possession, so, they have retirement accounts. They have 
501(c)(3)'s with moneys that are in their possession that they 
have access. Sometimes, we have people that are asked to take 
out loans. They use resources from their home equity, so, they 
do have resources, or they would not be the same kind of 
targets.
    I think some of what we are really looking at is in 
Indiana, the Indiana General Assembly has recently passed what 
is called a Senior Protection Act, so we have asked for 
additional enhancements to our consumer protection statutes to 
focus on those who will go after the vulnerabilities of 
seniors. I do think that it requires special attention and it 
is something that we have focused on.
    Just since that statute has passed, we have had 3,067 
complaints specifically regarding senior consumers, so, this is 
just a little over a year. A lot of these scams involve home 
improvement fraud. We have a lot of people that will offer what 
is really unnecessary work.
    We have got a considerable number of examples where people 
will do the door to door, so, it is not all online. You will 
see things in the mail, but, a lot of it is door to door, so, 
you will have people that come up--some of the examples of when 
they come up and try to offer their services. If there is a son 
or a daughter there, they will come back later, recognizing 
that they need to get the seniors alone, so, these people 
really do deserve, let us say, an enhanced penalty, and we have 
at least gotten some of that.
    One of the benefits of being in Indiana, we usually are not 
the first place a fraud starts, so scams come from both coasts. 
Sometimes, they originate out of Chicago, but, we get a little 
extra warning, so, in working with our Federal partners, 
particularly the FTC, other Attorneys General around the 
States, law enforcement, the Better Business Bureau, AARP, when 
we hear about scams that are likely to be coming to Indiana, we 
have created what is called a Fraud Alert System. We recommend 
that seniors go onto our website, Indianaconsumer.com, register 
for a fraud alert, and when we see things that are coming, they 
can literally get a short notice, so, it is either in an e-mail 
form or a text, depending on how they choose, but, sometimes, 
just knowing what the new scam is puts you at a heightened 
ability to recognize the scam when it comes.
    The other thing that we have really focused on is the 
creation of our outreach system, so Michelle Mayer, who was 
just mentioned, she and her team of four others travel around 
the State giving programs, so, they will literally go through, 
how do you protect yourself, and a lot of the audiences that 
are most interested are our seniors, so, we will come to 
whatever group asks, and we can usually find ways that you can 
tailor fit to the needs and the vulnerabilities of the 
community, so, if it is not seniors, we have done a number of 
programs with other types of groups where we can literally go 
through and give common sense ways to protect yourself.
    We have created what we call the tool kit, and again, it is 
all online at this Indianaconsumer.com, where you can go 
through and find easy ways to do simple protections. Now, 
again, education is always the best, but some of the things 
that I have always recommended, obviously, with some of the 
technology that is out there, the ability to steal identities 
and create new forms of loans or some type of a credit card 
where they can then run up the credit card.
    The easiest thing to do is, again, on our online system and 
with the help of the Indiana General Assembly, we have what is 
called a security freeze, so, you freeze the credit reporting 
services, the three credit reporting services, so that if 
people did steal your identity, you cannot open up a new credit 
card. It takes, literally--when I did it, it was 10 minutes. It 
freezes all the ability to open up new credit. If you do want 
to--I think I was at Sears or something and they were going to 
give me a 15 percent discount if I opened up a Sears card--you 
can go online real quickly, open it up for, I think it is three 
days. They run your credit report, you get your credit card, 
and then I think it closes automatically, so, things like that, 
and, frankly, seniors are probably well advised. They should 
not be opening up new lines of credit anyway. I mean, they have 
already got their nest egg, hopefully, and they have got 
whatever fixed income they are living off of. Opening up new 
lines of credit is probably something that they are not 
really--they should not be in the market for. Offering that 
security freeze.
    Obviously, everybody, hopefully, by now, we have promoted 
our ``Do not call.'' That does protect you in some ways, but 
with the new VOIP, the Voice Over Internet Protocol, these 
overseas calls now come in. A lot of them are robocalls. We are 
trying to teach people--and, again, seniors may be particularly 
vulnerable because they are not from the generation that is 
used to hanging up on people. I have to tell them, I know we 
all love our neighbors and we trust each other, but just hang 
up and say a prayer for them, and maybe that will make it----
    There are some things like that. We have a lot of examples. 
You know, when you were talking about the Grandparent Scam, the 
latest variation is that they go through Facebook accounts of 
our kids. They see pictures of the family, the names. They find 
that they are going on vacation and they are taking pictures 
from Florida, so, the call to the grandparent is already after 
they have done their own homework and education, knowing who to 
mention, what names to use, that they are in Florida, that they 
got in trouble, that they need money. These are not just random 
calls. These are people who have really targeted our seniors 
and are knowing a lot more about them because of the 
information that is all too available. Some of our younger 
citizens do not know what privacy means, but, it puts their 
grandparents at risk, and I think it is something we need to 
spend more time educating on.
    The sweepstakes and the fake lotteries, those things, we 
have tried to educate people that if you did not register for 
it, you cannot win, but, again, particularly among people who 
would like to have something nice happen to them, I think the 
vulnerability is there.
    Finally, I would just say that some of the things that I 
would also, while you are talking about seniors, we do have 
problems with prescription drugs being taken out of their 
medicine cabinets, so, we have talked a lot about the Take Back 
programs. We need your help with the DEA, that still has not 
passed rules that allow us to bring medicines back as easily as 
we would like, but, those are other risks to grandparents and 
their grandchildren that get into the medicine cabinet all too 
easily.
    Finally, I would say, in addition to the panel you have got 
here today, I would pay special tribute to a group called the 
Triad, which is in, I think, 23 counties now. It represents 
usually the sheriff, sometimes the AARP or some other senior 
groups, and then community organizers. They have really been 
some of the best when it comes to local protection of our 
seniors, so, the Triad groups really are people that we should 
all appreciate, and a little shout out to them.
    Finally, I will just say that, again, anything else that my 
office can do. We go all around the 92 counties, and we would 
be willing to work with either or both of you any time we might 
be of service. Thanks again for inviting me.
    Senator Donnelly. Thank you, Mr. Attorney General.
    Congressman Carson. Thank you, Attorney General.
    Senator Donnelly. We would next like to hear from Cynthia 
Mormon, Assistant Inspector in Charge at the U.S. Postal 
Inspection Service, and if you would speak into the microphone, 
that would be great.

             STATEMENT OF CYNTHIA MORMON, ASSISTANT

                INSPECTOR IN CHARGE, U.S. POSTAL

             INSPECTION SERVICE, DETROIT, MICHIGAN

    Ms. Mormon. Good morning, Senator Donnelly and Congressman 
Carson. Thank you, Senator Donnelly, for calling this important 
hearing on tools to empower seniors to identify scams and fraud 
and for the opportunity to share the important work the 
Inspection Service is doing to combat fraud against older 
Americans.
    As the Federal law enforcement, crime prevention, and 
security arm of the U.S. Postal Service, our goal is to promote 
confidence in the U.S. mail. We work to assure that American 
businesses can safely dispatch funds, securities, and 
information through the mail, that Postal customers can entrust 
their correspondence to the mail, and that Postal employees can 
work in a safe environment.
    To effectively enforce some 200 laws under our 
jurisdiction, 1,300 Federal inspectors are stationed throughout 
the U.S., and in Puerto Rico, Guam, Germany, as well as at 
Universal Postal Union Headquarters in Bern, Switzerland. In 
the last fiscal year, the Mail Fraud Program obtained over 400 
arrests and 410 convictions nationwide.
    Today, I will discuss several schemes conducted through the 
mail that disproportionately target older Americans. These 
include foreign lotteries and illegal sweepstakes, secret 
shopper scams, and love losses schemes.
    Foreign lotteries and illegal sweepstakes--these schemes, 
initiated by mail, e-mail, phone, or fax, are where scammers 
tell victims they have won a lottery or sweepstakes, often an 
international promotion. Victims must remit a fee, described as 
taxes, duties, or handling charges, to claim the prize. 
Unwitting customers remit large sums of money to these crooks, 
but instead of a prize, all they receive are more calls and 
mailings. Once victims take the bait, unrelenting scammers 
coerce them into sending even more of their hard-earned money. 
Some scammers send victims a check or money order as an advance 
and tell them they must send money to collect the rest of the 
prize, which is not how legitimate promoters operate. To gain 
victims' trust, some scammers use the name of well-known 
sweepstakes. Legitimate operators do not charge entry fees and 
do not require that customers pay a fee to collect winnings. 
When consumers win a legitimate promotion, they pay taxes 
directly to the government, not to the operator. Older 
Americans should get a promoter's number from directory 
assistance to verify the legitimacy, and any American who 
receives a notice that they have won a foreign lottery or 
sweepstakes should not believe it. It is illegal to buy or sell 
foreign lottery or sweepstakes tickets across the U.S. border.
    Work at home schemes--these victims receive a solicitation 
by mail or e-mail or respond to a job ad online or in print. 
Fraudsters hire respondents without an interview or background 
check to work as payment processors. They must deposit checks 
or money orders from the company into their own bank accounts, 
then wire money to their employer and keep a portion as pay. In 
a variation known as the ``mystery shopper,'' victims receive a 
check by mail or e-mail and must cash or deposit it. Once it is 
cashed, they are instructed to visit a store or money transfer 
company to test customer service or make some other 
observation. It usually involves making a small purchase and 
wiring the remainder of the money to the fraudster. In either 
case, victims are notified by their bank that the check they 
cashed or deposited is counterfeit and they are liable for the 
full amount.
    Love losses scam--these schemes involve an e-mail or phone 
call from someone purporting to have a romantic interest in the 
victim, who they met in a chat room or a dating website. Again, 
after gaining rapport, the fraudster asks the victim to send 
money or tells the victim they are in a foreign country and 
have a check or money order in U.S. dollars they cannot cash. 
They may claim to have a medical emergency or other problem or 
promise to come to the U.S. to be with the victim, but need a 
check or money order cashed to cover expenses.
    Postal Inspectors advise that people never send money to 
someone they do not know or have never met. Consumers should 
cash checks or money orders only for relatives or someone they 
trust. They are liable for any check or money order they cash 
or deposit, so they should ensure it is legitimate before they 
do so.
    Senator Donnelly, thank you for this committee and for 
highlighting the significant and troubling issue and allowing 
us to testify. We look forward to continuing to work with local 
communities to educate our older consumers and their family 
members on how to identify these schemes and prevent them from 
happening to themselves, their loved ones, and others.
    Senator Donnelly. Thank you so much, and thanks for your 
service to the Postal Service.
    We are fortunate to have Mandla Moyo here with us today. He 
is the Community Outreach Director for the Indiana AARP.
    Mr. Moyo.

         STATEMENT OF MANDLA MOYO, COMMUNITY OUTREACH 
         DIRECTOR, INDIANA AARP, INDIANAPOLIS, INDIANA

    Mr. Moyo. Thank you, Senator. Thank you, Senator Donnelly 
and Congressman Carson, for being here today. More importantly, 
Senator Donnelly, thank you for convening such an important 
hearing on such an important topic that affects older Hoosiers 
whom I have the opportunity and pleasure of working with on a 
day-to-day basis. Thank you, also, to Senator Nelson and 
Ranking Member Collins for their leadership on working to 
protect seniors from fraud and scams.
    Again, my name is Mandla Moyo and I work for AARP Indiana. 
AARP is a nonprofit, nonpartisan organization with membership 
of more than 37 million that helps people turn their goals and 
dreams into real possibilities by strengthening communities and 
fighting for the issues that matter most to families, such as 
health care, employment security, and retirement planning.
    AARP has staffed offices in all 50 States, the District of 
Columbia, Puerto Rico, and the U.S. Virgin Islands. Our Indiana 
office is located in downtown Indianapolis, and we currently 
have over 840,000 members statewide.
    For more than 50 years, AARP has been providing Americans 
with resources and tools that help them protect their financial 
security. That is why we recently launched the Fraud Watch 
Network, because too many hard-working Americans were being 
scammed out of the money they have earned. Research shows that 
more than $20 billion was stolen from about 13 million victims 
in 2012 alone. It is estimated that older adults are defrauded 
out of about $3 billion every year.
    A poignant quote from a recent AARP Report summarizes the 
devastation of these criminal activities. After a lifetime, and 
I quote, ``After a lifetime of doing all the right things to 
prepare for a comfortable and dignified retirement, too many 
older Americans are having their retirement security threatened 
by financial predators.''
    The AARP Fraud Watch Network connects people to experts, 
law enforcement, and fellow Hoosiers who are spotting fraud and 
sharing their experiences so others know what to watch out for. 
Available free of charge to AARP members and nonmembers alike, 
and people of any age, is the Fraud Watch Network, which 
provides Watchdog e-mail alerts that deliver breaking scam 
information, prevention tips based on the latest information 
from experts, an interactive map with the latest law 
enforcement warnings from each State, a phone number that 
people can call to talk to volunteers trained to help fraud 
victims, and access to a network of people who are sharing 
their experiences with scams so they can help others protect 
themselves. Folks can sign up either online, by going to 
fraudwatchnetwork.com, or by calling 877-908-3360, to get 
resources by mail and sign up for phone alerts.
    Locally, we currently have 27 Indiana volunteers working 
specifically on getting the word out about the Fraud Watch 
Network. For one of the most active Fraud Watch volunteers, 
this issue of online fraud became too real. Melvin from Carmel, 
although a tech savvy individual, Melvin was a victim of 
identity theft after making a purchase online. If it can happen 
to him, it can happen to anyone.
    For example, the GFK Group conducted an Internet-based 
survey for AARP last November which showed that while the vast 
majority of Indiana online users--76 percent--say they are 
concerned about being scammed over the Internet, they only were 
able to answer an average of five out of the ten questions in a 
simple online literacy test designed to test their knowledge 
about how to be safe online. For instance, 56 percent of 
Hoosier respondents are unaware that a privacy policy does not 
always mean the website will not share information with other 
companies. Thirty-eight percent are unaware that banks do not 
send e-mails to their customers, asking them to click on links 
to verify personal information, and, 72 percent of Indiana 
adults that access the Internet, or as many as 2.7 million 
people, received at least one online fraud offer in 2013.
    The most common scams that target older Americans involve 
buying and selling gold, the emotional grandparent scam where 
the caller poses as a distressed grandchild needing money, and 
bogus sweepstakes that offer an irresistible pitch--you have 
won, just pay this simple processing fee. According to the 
Federal Trade Commission, reports of consumer fraud have 
increased over 60 percent since 2008, and online scams doubled, 
from just 20 percent in all fraud in 2007 and nearly 40 percent 
of all fraud in 2011.
    As such, AARP will continue to spread the word about the 
Fraud Watch Network and help safeguard the retirement security 
of older adults.
    Thank you again for inviting me to testify today, and I 
look forward to taking your questions.
    Senator Donnelly. Thank you very much. The final statement 
we will have will be from Mark Lindenlaub. After that, we will 
be asking a series of questions to get your best ideas, but, 
Mark is the Board President of the Indiana Association of Area 
Agencies on Aging. Mark, thank you for being here.

            STATEMENT OF MARK LINDENLAUB, EXECUTIVE

              DIRECTOR, THRIVE ALLIANCE, COLUMBUS,

             INDIANA, AND BOARD PRESIDENT, INDIANA

             ASSOCIATION OF AREA AGENCIES ON AGING

    Mr. Lindenlaub. Thank you, Senator. Thank you for the 
opportunity to be here. I am the current Board President of 
I4A, or the Indiana Association of Area Agencies on Aging. I am 
also the Executive Director of Thrive Alliance in Columbus, 
Indiana, which is a local Area Agency, or AAA, serving five 
counties in South Central Indiana, so, on behalf of the 16 
Indiana AAAs, the older Hoosiers, persons with disabilities, 
caregivers, and family members of those that we serve, I want 
to thank you for the opportunity to be here. Thank you for 
convening this committee and bringing us all together.
    In Indiana, AAAs are the gateway through which most 
Hoosiers access long-term care services. We administer a 
variety of local, State, and Federal funding sources, such as 
the aged and disabled Medicaid waivers, the Older Americans Act 
Title III funds, social services block grants, and a State 
appropriation called the Choice Program, all of which allow 
older adults and people with disabilities of any age to live 
and age safely in their own homes and in their own communities. 
We also assess all Indiana residents who are seeking nursing 
home admission.
    The U.S. Administration on Aging has established a national 
network of Aging and Disability Resource Centers, or ADRCs. 
These ADRCs comprise a very specialized focus network of ``no 
wrong door'' that serves as trusted places in communities all 
across the country where people of all ages, incomes, and 
disabilities can go for information about these topics. Thanks 
to the foresight and investment of the Indiana Family and 
Social Service Administration in the mid-2000's, Indiana was 
the first State in the Nation to have all 16 of its AAAs 
designated as ADRCs, which gives us a very powerful network and 
sort of unique position among your peers in Washington.
    As the State's front door to senior services, Indiana ADRCs 
know firsthand the toll that fraud, scams, and other forms of 
financial exploitation have on Hoosier older adults, but we 
know, as we have talked, we cannot really address the things 
that are reported to us, so, to this end, I think one of the 
unique roles that we play as local agencies and as a network is 
to be that vital trusted local resource that seniors feel like 
they can call when they have a sensitive issue regarding 
exploitation to talk about. As we know, victims of exploitation 
are particularly embarrassed, feel stigmatized, or generally 
are not comfortable contacting local law enforcement or other 
officials many times.
    Victims can also contact their local AAA for assistance in 
navigating the complex web of other agencies, some of which you 
have heard this morning, who are involved in handling the 
variety of cases of fraud and exploitation, including Medicare, 
Postal Service, Social Security, Indiana Medicaid, Indiana 
Attorney General, and so forth.
    Every Indiana AAA can tell you many, many stories about 
fraud and exploitation. You have heard some terrible stories 
already this morning. We have several that are listed in the 
testimony, that I will not go through all of those, but, I do 
want to highlight just one.
    This is an 89-year-old woman in Columbus who called our 
office to say that she thought she had been a victim of fraud. 
She had received a call from a man that told her due to changes 
in Medicare with Obamacare coming online, she needed a new 
Medicare card, so, he proceeded to collect her Medicare 
information, including her Medicare number, as well as bank 
information so that he could process that new card for her. She 
gave the scammer the information, hung up the phone, thought 
about it, and realized that was probably the wrong thing to do, 
so, the next day, she called her bank, told them not to allow 
any charges to be made, and then a couple of days later, she 
was called by the same person, very irate because he was not 
able to access her financial information.
    She hung up on him, but felt like she needed to tell her 
story, so called our office. Through conversations with her, we 
were able to counsel her to make sure that she followed up with 
her bank, talk to the Medicaid office. She talked to local 
police. As a result of those conversations, there was a 
newspaper article the next day and she ended up, instead of 
feeling a victim of her experience, feeling very empowered that 
she was able to not only help herself, but help others who saw 
her story.
    In conjunction with the other AAAs and senior center 
partners, I4A also administers Indiana's Senior Medicare 
Patrol, which identifies and reports individual cases of fraud, 
such as those that have been described this morning. I think 
another unique way that the SMP works is to work closely with 
news media to get the stories out. We have found very often 
that when stories of fraud are publicized, the details of that 
fraud are recognized by seniors who receive similar letters or 
phone calls or e-mails and they can then understand how those 
scams are trying to target them and protect themselves from 
being a victim themselves.
    Statewide, we know reports of senior financial exploitation 
have exploded over the last few years. Over the last decade, in 
particular, the Division of Aging, Adult Protective Services 
has reported calls to their office have increased 400 percent. 
Abuse cases increased 30 percent, neglect cases 13 percent, but 
financial exploitation an alarming 83 percent. Many more times 
faster growth than some of the other traditional abuse and 
neglect cases that they deal with. APS now reports an average 
of 126 reports per month, which is a 15 percent increase from 
last year, and these calls on financial abuse represent nearly 
15 percent of all the calls they receive, or about 1,500 calls 
in 2014.
    Given the epidemic proportions of senior financial 
exploitation in Indiana, ensuring the sustainability of the AAA 
network is critical, in particular, the ADRC network that is 
associated with us. We play some key roles in fraud and 
exploitation prevention, including being that safe trusted 
place that people can call at the local level. We provide 
general fraud and abuse information and education in our local 
communities. We work closely with all of the other agencies 
involved in fraud prevention and refer cases to them, as 
appropriate. We do one-on-one counseling with people who call 
our office to help them figure out a plan forward. As I just 
mentioned, we host the Senior Medicare Patrol staff and 
volunteers and help their work to integrate with the full range 
of services and resources that we have in our offices.
    Finally, we also help victims rebuild after exploitation. 
It is not just the financial hit that people take, but very 
often, it is an emotional hit, as well, and we help them to 
regain some confidence in their lives.
    This amazing network is in place now, but it is not assured 
to be a sustainable network due to some funding issues at the 
Federal level, so I would like to urge you and the Senate 
Special Committee on Aging to champion the renewal and 
reauthorization of the Older Americans Act, which has been 
stalled in Congress. Among the various titles in that Act, the 
Title VII does provide elder abuse protection and ombudsman 
programs and funding for those.
    Further, we would urge the committee to ensure the 
sustainability and adequate funding of the AAA network as a 
whole through the Older Americans Act. That funding has 
remained relatively flat, if not slightly declining, over the 
last ten years. As we know with our aging population, the 
number of people who are requesting services, and in particular 
potential victims of financial exploitation, are growing 
exponentially, so, we believe that reauthorization should and 
will have bipartisan support and would ask your support there.
    We would also ask your support. We believe the committee 
can play an integral role in advocating funding for the Elder 
Justice Act of 2009. Parts of that Act are in play, but many 
vital parts have not had any appropriation and we would urge 
you to support the President's $25 million Elder Justice 
Initiative that he has included in his Fiscal Year 2015 budget 
proposal.
    Finally, we anticipate the elder justice and senior 
financial exploitation is going to be a very important topic in 
the 2015 White House Conference on Aging and we would urge 
congressional support of the Conference. In particular, we ask 
you, Senator, and you, also, Congressman, that you would ensure 
that the Indiana Association of Area Agencies on Aging would 
have an active role in providing information for that effort.
    Thank you again for your consideration of our testimony and 
our request for your support.
    Senator Donnelly. Thank you very much.
    We all know the challenges that our seniors face. It, 
obviously, is something that goes across the board, though, 
too. I just wanted to relate to you real quick, when I was 
fortunate enough to be elected to the Senate, I had to look 
again for a place to live in Washington, which is an 
outrageously expensive city to have a place, and so it is, how 
can I find something that is smaller than a studio but costs 
what a three-bedroom apartment costs in Indianapolis, is 
basically the formula.
    I checked, called the number--or, actually, it was an 
online. I went online and they said, sounds terrific. We have 
it available for just a couple of days, so you have to jump in 
on it quick. Before we are able to let you have the keys to 
take a look at the place, you have to wire us this amount. I 
happen to be in England and I am studying for my Master's 
degree or whatever it is, so, if you can wire the funds for a 
first month's rent, if everything looks amenable to you when 
you go in, we can close the deal.
    I sent back an e-mail that said, how about I just contact 
the superintendent, take a look, and then find out after I take 
a look at it how the place looks. Never heard from them again.
    It comes in so many directions and in so many ways, and the 
Internet has opened this up to just about every creative ne'er 
do well that seems to be out there.
    Joyce, I want to ask you, in regards to stigma and that 
people, our seniors, can be embarrassed about being involved in 
something like this, where they look up and they go, oh, I have 
worked so hard, my children will be embarrassed if they find 
out about something like this, did that ever get involved with 
your mom, that she did not want to tell you too many of the 
details or anything like that?
    Ms. Walker. Well, my mother has a degree from South Bend 
Business School back in the 1940's. She worked in a bank in 
South Bend, one in Culver. She always managed all the finances, 
took care of the taxes, the forms, and that was her pride, that 
she was so good with finances and money, and, the first time he 
called, she was on top of things. No, I do not give out any 
bank information.
    Senator Donnelly. You are calling the wrong person today.
    Ms. Walker. Exactly, but, then, when he identified himself 
as her doctor--the coincidence in timing was really odd, 
because my dad--we were spending thousands of dollars for my 
dad's care. He was very ill at that time, and, so, she was 
writing checks for that kind of money, and so this was just 
another one. It fell right in.
    She did not believe me. Weeks and weeks went by and I kept 
telling her, that is not your doctor, and she would not believe 
me at all. Finally, I sent her 16 pages of my homework, because 
I know she can read, and then she got it, but, to this day, she 
will not talk about it. She was very humiliated by the whole 
thing.
    Senator Donnelly. Here you are, her daughter, and, in 
effect, they almost set up a relationship where it is they and 
your loved one against the family. They create personal 
relationships, in effect, too, as they do this kind of thing.
    Ms. Walker. Yes.
    Senator Donnelly. Mr. Attorney General, as you look at 
this, do you see for our seniors that they are embarrassed by 
this sometimes, and how do we reach out and tell them, look, do 
not be ashamed of what has happened. It is most important to 
work with people, let them know what is going on, and to get 
that information out.
    Mr. Zoeller. I think there is no doubt, it is true that 
they do not want to admit it to people, including their own 
family, so, it is often after they have gotten themselves in 
trouble financially that they finally have to admit that they 
have paid more and more money, so, these things often have a 
long track record before they finally come forward.
    You know, one of the things that, and it is hard to 
believe, but if you have been scammed, you will now be on the 
list and people will contact you over and over, so, the 
vulnerability that one has recognized now gets passed around, 
so, whatever this network of scammers is is very sophisticated, 
because we find people that are re-victimized, so, one of the 
things we have done in our office is, in the Identity Theft 
Unit, particularly, we have created opportunities to go and not 
only freeze your accounts, you can now go into Circuit Court in 
your county of residence and show that you have been a victim 
of identity theft and get a court order that now allows you to 
pass that order on to some others who do not believe you that 
you have been scammed, but, this repetitive nature of once you 
have been a victim to be identified as vulnerable and re-
victimization is something that we really need to have more 
tools at our disposal.
    Senator Donnelly. Assistant Inspector, this is pretty 
sophisticated in its operations, too, is it not? It is not just 
a person who is calling to a senior. This is an intricate 
operation.
    Ms. Mormon. Yes, it is, and we have a fraud complaint 
system that we use to take in the consumer's information, but, 
we also receive complaints, and when we receive the complaints, 
then we send them out to the field and to other law enforcement 
agencies, as needed, but, the things that we are looking for is 
whether it contains identifiers that represent it as part of a 
scam, and if it is something that is a scam, it is probably 
happening, like you said--it is disproportionate in that the 
scammers will often change the scam and they will move on to 
another area and then they are still repeating the same scam in 
another format, but, those are things that we are alert to that 
we have to get out as we educate the American public.
    Senator Donnelly. Mr. Lindenlaub, you work with our seniors 
a lot. How do we get them to talk to each other about this and 
about the dangers of these things, the calls they have been 
getting, as opposed to them saying, well, I do not want to let 
anybody know because I am embarrassed. I am embarrassed 
somebody hoodwinked me after--for instance, your mom, after a 
lifetime of running a small business or of being involved in 
another business--that, at this point in my life, I got 
snookered, in effect. How do we get our seniors to talk to each 
other about this rather than be embarrassed about it?
    Mr. Lindenlaub. Well, I think the first person they are 
going to talk to is somebody they really trust a lot, so, 
keeping our seniors--especially for people who are living at 
home, keeping them engaged in the community is really critical, 
making sure they have support networks among caregivers, 
family, and other friends, so, I think one way is just kind of 
helping people to build that personal support network at the 
local level.
    Communities can help by reaching out with this topic. I 
know that the film ``Fleeced'' has been going around the State, 
and you are probably familiar with that. That has been, I 
think, a great vehicle for helping to open up some 
communications. I know we showed that down in Columbus and had 
over 70 people attend that showing and had a really great 
conversation around that.
    It takes some effort. It takes some effort on our part to 
reach out, and I think we just have to keep hitting the facts 
that people are a victim. They are the ones that are victims. 
It is the people who are perpetrating the fraud that should be 
the ones that suffer the consequences.
    Senator Donnelly. Great. We are going to take turns, about 
six or seven minutes, asking questions, and I was going to--I 
will not say--I was going to jokingly say my partner in crime, 
and that would be a bad way to approach this----
    With the Attorney General and the Secret Service here, that 
would be the wrong thing to say. My colleague and fellow Member 
of Congress, Congressman Carson.
    Congressman Carson. Thank you, Senator. Thank you, friend.
    Attorney General Zoeller, as we move into a more digital 
age, where are even Federal offices--everyone is transitioning, 
locally, federally, statewide, into more electronic 
communications. How do we improve verification with these new 
systems and to create firewalls to let seniors know that they 
are dealing with a trusted source on the other side?
    Mr. Zoeller. Well, some of the problems in technology 
really require technological solutions, so, some of the 
identifiers on your computer--so, for instance, when we work 
with people like the software manufacturers and all the players 
in the field, they are working on these new systems where they 
will have a randomly generated number that will protect them 
from the IP address that everybody now can see.
    The sense that people think of themselves as being, let us 
say, anonymous, is not really true, so, in some cases, it helps 
law enforcement that we can track down who owns this computer. 
On the more vulnerable side, we are now identifying who owns 
the computer to the hackers and the more sophisticated fraud, 
so, I think, all of these problems really lend themselves--
first of all, we need to let people know that they are 
vulnerable.
    The difference, and I always make this reference, that the 
difference in our sense of what is personal information---the 
difference between the United States and Europe is remarkable, 
and I think there ought to be more attention paid to the way 
the European Union has addressed privacy rights. Companies do 
not own the information in Europe. In the United States, we 
have the opposite. Unless you have denied them the permission, 
they automatically own all this information.
    The amount of information that people can access, that is 
sold legitimately, and then illegally sold to others is how the 
scam operators operate, and if you compare that between here 
and the European Union, you will see a remarkable difference. 
Target gets hit. They have millions of people during the 
holidays that were--their information was hacked. No one in 
Europe, because Target in Europe cannot collect that 
information and maintain it.
    Again, we really need to address what are the 
vulnerabilities of our systems. We need greater technological 
improvements to protect people, but, we also need to look at 
this idea of how privacy is addressed, and I think that is 
something that I have tried to get people to focus on, the 
difference between our country and, particularly, the EU.
    Congressman Carson. Thank you, sir.
    Inspector Mormon, would a more coordinated national public 
service campaign help reduce the scams that you have 
encountered, and what is your current educational strategy in 
informing the public?
    Ms. Mormon. Yes, we do several campaigns. Each year, we 
have a National Consumer Protection Week where we partner with 
the AARP, and we actually provide shred events and 
presentations. We provide the shred events so that people know 
how to get rid of their personal information. Instead of 
throwing it away in the trash, then they can bring it to a 
local place where all their information will be shredded onsite 
while they are there.
    We also have what we call our Consumer Alert News Network, 
which is a partnership we have with Litton, and those are 
Public Service Announcements that are shown nationwide in 
segments that demonstrate the different types of frauds that 
are out there. They have Postal Inspectors that talk about the 
frauds as well as victims or the loved ones of the victims that 
will talk about how those schemes have affected them.
    We do presentations with senior communities and recreation 
centers, any sorts of agencies and organizations that work with 
seniors, as well as educating our own employees to be on the 
lookout for some of these mailings that may come through the 
Postal Service itself.
    Congressman Carson. Thank you.
    Last, Mr. Lindenlaub, in your observation, sir, what is the 
best way for nursing homes or other elderly care providers to 
inform family members of suspicious interactions without doing 
a disservice to the privacy of the clientele?
    Mr. Lindenlaub. Yes, and certainly, privacy is an issue. We 
have gotten reports from nursing facility staff members. We 
have heard from bankers that we work with. We have heard from 
investment folks that you would go to for IRAs and so forth, 
all calling our office saying, you know, I have got this 
client. They are writing checks. They are kind of exhibiting 
behavior that is a little unusual for them. It goes as lot of 
different ways. It can be for things through the mail that they 
have gotten.
    Sometimes, it is a family member, so, we have not really 
touched on that too much today, but, there is the grandson who 
cannot quite get and hold a job but needs to pay their rent 
kind of scheme, too, that is out there, and sometimes, family 
members are the worst, and, those are probably even less likely 
to be reported.
    Congressman Carson. Absolutely.
    Mr. Lindenlaub. I would just say that we need to make sure 
that we have a system that allows that kind of information to 
go back and forth. If there are laws or regulations that clamp 
down on that, and I know we do want to protect privacy, we have 
got to kind of weigh that against the victimization that 
happens when that observation cannot be given to the family 
members to take action on.
    Congressman Carson. Sure.
    Senator Donnelly. Thank you.
    To give you an idea of the scope of this, it is estimated 
that, in regards to the Jamaican lottery scam--think of this--
they make 30,000 calls every single day into the States, trying 
to find people, trying to create relationships--30,000 calls 
every single day. There was a family member who testified 
before our committee earlier, in Washington a few months ago, 
who testified that they created a relationship with her mom 
where they basically told her mom not to let everybody else 
know what was going on. They really cared about her. They had 
her best interests out, and you never know about your family 
and what they are thinking and all of these things, and, in 
effect, pitted the family, the children, against her buddy who 
calls her every day, and, the mom was saying things like, well, 
he calls me every single day to see how I am doing. Do I hear 
that from you every single day? In effect, sets up a dichotomy, 
that, who loves you move, and winds up using money--the 
opportunity to obtain money as part of this.
    As we look at this and the importance of education, Mr. 
Moyo, what are the kind of things that AARP can do through 
community outreach to educate our seniors and the public as to 
what is going on?
    Mr. Moyo. Sure. Just to highlight some of the other issues 
that have come up, I think one of the important things that we 
have done as an association is that we have decided to do a lot 
of our education and outreach through the hands of volunteers, 
and that gives it a face, or a community face where people can 
open up and share. I think, a lot of times, like we have 
mentioned and a lot of my colleagues have mentioned on the 
panel, that a lot of folks feel a stigma with being victimized, 
and so we have chosen to take it out of the hands, say, of a 
staff member and put it toward volunteers and actually have 
folks that live in the communities and that have relationships 
to do these presentations in the community and educate 
themselves.
    Then, we have also taken it to--the next step is to provide 
that information, again, free of charge--all of our literature, 
all of our presentation material is all free of charge, and 
folks can access that and take that home and have those 
conversations with grandma and with mom. That simplifies the 
conversation and brings it home and allows for that 
conversation to happen freely, to where some of the issues that 
you have talked about, where family members are being pitted 
against each other and scammers are using that emotional touch 
to get at that senior's resources, so, I think we have taken an 
approach where we, as sort of a staff or a team, would much 
rather have somebody in the community, a local volunteer, to 
share that message and it allows for that free communication to 
happen, as well, so, thank you.
    Senator Donnelly. Mr. Attorney General, how do they 
identify targets, for instance, with the grandparent scam that 
you talked about, and you mentioned Facebook. There is, 
obviously, research that goes into this.
    Mr. Zoeller. Well, the information available online is 
really remarkable in terms of its misuse, so, we often focus on 
why it is so great to have this technology and the vast amounts 
of information that is available.
    You know, for instance, when our outreach office goes 
around and gives presentations, they give helpful little hints 
on how to avoid the scam. The one, I think, that is kind of 
demonstrative of this is that if you sign up for a magazine 
subscription, it is only ten dollars for the year, and yet they 
want all of your mailing information, all your, I would say, 
personal information, so, they sell that information.
    One of the hints that Michelle Mayer gives out is to use 
your pet's name at your address, and, then, every time you see 
``Fido'' or whoever----show up on your mail, you know where 
that came from.
    Senator Donnelly. Maggie Donnelly.
    Mr. Zoeller. Yes. Little tricks like that, and it helps 
educate people as to where this information is coming from.
    Now, online, when you sign up for things, that information 
is being sold over and over, and I think the risks of it being 
sold illegally--and that is the part that we have to really 
address. Sometimes, in the privacy listings it says that we 
will sell this information to only, and then it is, like, a 
half-a-page of who--well, they do not ever take responsibility 
to where that information goes from there, and, I think it is 
that tertiary market of selling the information that has made 
us very vulnerable in the United States.
    Senator Donnelly. Ms. Mormon, as we educate seniors and try 
to get them to understand the different angles that these 
people are attacking from, I mentioned the mailer that went out 
with our congressional office--my name on it, our 
congressional--Indiana Second District--and it was survey, or, 
like, Public Census Survey, so it looked very, very official, 
and then asking for credit card information and then money. 
What are some of the warning signs, not only for seniors but 
for others, that they should be aware of when they are opening 
the mail or when they are speaking to someone in regards to 
these kind of pieces?
    Ms. Mormon. Well, as we always say, if it looks too good to 
be true, it probably is, and some of the information that is 
contained in there is--it is always a rush, or you have won 
this prize, now send money. There are never any fees or any 
duties or taxes associated with things of that nature, so, some 
of the things they have to look out, when it is a legitimate 
sweepstakes that is being conducted, then they have to put, 
``No purchase necessary.'' They have to have all the rules 
written out on the information. They have to have the business 
address and the name of the person that is actually sponsoring 
that.
    A lot of the times, if you are working with a scammer, they 
are not going to have any of this information available, so, it 
is always good to not only contact the Attorney General's 
office or the Better Business Bureau to find out if that is 
truly a legitimate company that you are responding to.
    Senator Donnelly. Thank you very much.
    Congressman Carson.
    Congressman Carson. Thank you, Senator.
    Adding on to that, Ms. Mormon, what sort of training do 
regular Postal workers have or need to have to ensure the 
proper handling of even reporting scams?
    Ms. Mormon. We actually educate our employees on things to 
look for, such as mail that might be arriving in various names, 
or even our clerks right now with the Jamaican lotteries, they 
are taught--because a number of the older Americans will come 
in with large sums of money that they want to send out Express 
Mail, and they are taught to contact us immediately when those 
mailings--when they are trying to mail something so that we can 
get those mailings identified and try to stop them at one of 
our International Service Centers before they actually leave 
the country, because we certainly do not want them to be 
victimized, and our clerks understand the magnitude of the type 
of scam that is being involved, and, sometimes, the customers 
do not have a vested interest in knowing that that is a scam 
that they are a part of. They just know that they have to send 
the money, so, our clerks are well aware of contacting us 
immediately when any large checks or sums of money are brought 
in and they want to go out express, especially to a foreign 
country.
    Congressman Carson. Madam Walker, you mentioned in your 
prepared testimony--one of the things you said is that families 
should consider using legal means, such as Power of Attorney, 
to be able to oversee finances for elderly relatives. How would 
you recommend individuals approach that subject without 
appearing as though they are trying to take away independence 
or control from their loved ones?
    Ms. Walker. Exactly what happened to me. There is one group 
we have not mentioned today, and that is doctors. My father was 
a stroke victim, and my parents lived in an assisted living 
home, and last June, he took a turn for the worse and he did 
not want to go to the nursing home. He was still trying to make 
his own decisions. Bless his heart, the real Dr. Sitar, my 
parents' real doctor, was very terse with me on the phone. He 
said, you need to get out those Power of Attorney papers, 
wherever you have them hidden, and you need to start--he said, 
when people get in their 90's, they do not make rational 
decisions anymore.
    Congressman Carson. That is right.
    Ms. Walker. He said, you need to make the--you need to step 
up to the plate and make decisions, and thank God that 
happened, because that happened. Then, I started taking over 
the finances before the scam, so, I already had some control, 
but, I just feel like there are too many doctors out there that 
say, we will give you some medicine to make you feel better, 
and they are not on top of that end of the situation.
    Congressman Carson. Mr. Moyo, not only are there numerous 
vulnerable seniors living on fixed incomes, they often do not 
have access or even utilize or even trust technology in the 
same way younger generations do. Many Federal and State 
agencies have become more reliant on remote communications. How 
would you suggest we strike a balance in making sure seniors 
are protecting themselves from scams while benefiting from the 
wonderful technological advancements that have been made in the 
past few decades?
    Mr. Moyo. Great question, Congressman. I think one of the 
things that has to be--I think even understanding the fact that 
some seniors have an apprehension to technology, I think 
education--through education and outreach, I think it is key to 
bring folks along on the correct ways to use technology. I 
think that a lot of our--I think my own grandparents are on 
Facebook solely because they want to see pictures of us and 
their other grandchildren, so, I think, if we can coordinate an 
effort or an education piece that highlights the importance or 
the great things about technology, that shows them that that is 
something that they should not be afraid of, because if you 
look at medical records and things like that, all of that stuff 
is kind of moving in that direction.
    I think, we have to be able and comfortable enough to bring 
our seniors along in a manner that is respectful to their 
needs, as well, but not totally shutting out the phone trees or 
being able to access either your office or other offices 
through the telephone, as well, so, I think it is important to 
have both of those measures happen at the same time.
    Congressman Carson. That is good. Thank you, sir.
    Senator Donnelly. Thank you.
    Mr. Attorney General, I want to followup on the 
Congressman's question in regards to Power of Attorney and 
family situations. Are there any recommendations for those 
situations where one of our parents is getting older and the 
decisions do not seem as logical in regards to finances or 
other things? You go into a checkbook and you find these checks 
written out to Charlie whatever-his-name-is, who turned out to 
be a her. Do you have any recommendations as to how to handle 
that progression in financial responsibility in the family?
    Mr. Zoeller. Well, Senator, there is a growing area of 
practice--usually lawyers do not specialize, but there are a 
number of practices that allow you to specialize, and the most 
recent one is on what is called elder law, so, it is a 
specialty. You have to learn a lot of those techniques of how 
to work with the aging population.
    Now, the problem is not enough people still have the family 
lawyer, so, in, let us say, another generation, you would have 
had the family lawyer, who would recommend an elder law 
specialist that would help you with the complexities of, let us 
say, elder law, so, it deals with Medicaid, Medicare, your 
investments, all the things that seniors really have to focus 
on, which would include--you know, obviously, we always had 
wills, but the idea of Powers of Attorney and some of the, let 
us say, the more specific legal documents that help protect our 
seniors and give other people the opportunity to protect them.
    Those things really are a growing area of the practice of 
law, and again, there are not enough elder law specialists 
available, but the ones that we recommend can give programs and 
tell people what they ought to be doing to prepare for having 
their parents, their grandparents, protected in this, let us 
say, more complex area.
    Senator Donnelly. Mr. Lindenlaub, this has been an area 
where there have been pretty strong partnerships, too, is it 
not, where you have worked with the Attorney General, with 
AARP, with others. Could you explain that a little bit, how 
this is not just your organization by itself but pretty much a 
teamwork effort to try to help?
    Mr. Lindenlaub. Yes, absolutely. I mean, we have talked 
about how sophisticated and, in some cases, just how large some 
of these scam operations are, and I think there is a really 
important role to play at the local level, because when the 
scam happens, it happens to somebody who is local in their 
community, and if we can prevent that, great, but when it does 
happen, we need to have it reported and be able to take action 
on that.
    Often, at the local level, because of the scope and scale 
of sophistication of some of these efforts, we do not have the 
resources or the knowledge to effectively deal with that, so, 
whether it is the Post Office, Indiana Attorney General, or 
other organizations that we would work with, we need to have 
really good working relationships and clear communication so 
that when scams are reported at any one of us, we can make sure 
that the victim is directed in the right ways to further 
protect themselves from any additional being taken advantage 
of, as well as, hopefully, to get to the scammer themselves and 
put them out of business.
    Senator Donnelly. Inspector Mormon, do you have a, like, a 
graph almost, or almost a spreadsheet, of all the partners that 
the Postal Service works with on this, because I would think 
you are one of the key spokes in this whole wheel and you see, 
more than almost anybody, from the different angles, the 
different parts of the country, the things that are going on, 
and, so, I would imagine you have a pretty extensive network of 
partnerships.
    Ms. Mormon. Yes, as a matter of fact, we do. Nationwide, 
with the Federal Trade Commission, we have an excellent 
relationship, but, our working levels in the field are 
dependent upon the area that you are in, because some of the 
larger departments or agencies tend to have--they do not work 
so closely with us, but, in your smaller cities, because they 
rely more and communicate more on the different resources they 
may not have available, then we reach out more with some of the 
smaller communities, but, it just depends on the area that we 
are in as far as the field level in some of your major cities, 
but, nationwide, as a whole, then we do have partnerships which 
are maintained at our headquarters in Washington, DC.
    Senator Donnelly. Congressman Carson.
    Congressman Carson. Thank you, Senator.
    Attorney General, in your experience--I know you work very 
hard and deliberately with building relationships with the 
General Assembly and Members of Congress and the Senate---in 
your experience, what sorts of policies are needed to really 
deter potential scammers, or do you even think that these 
criminals are going to continue what they are doing because of 
ease of access to information that they have?
    Mr. Zoeller. Well, there is no question that we ought to be 
prepared for more and more of this, so, I wish I could tell you 
that we are going to get out ahead of it and stop it, but, I do 
think some of what we do at the State and local level is always 
going to be frustrated with our inability to go after scammers 
who are overseas, so, we do not have the long arm of the law 
that will reach the Jamaican scam artists.
    I will say, the Federal Trade Commission should really be--
let us say, we should all thank them for their efforts. They 
have what is now called the Consumer Sentinel, which a lot of 
States have started to send our scam information into, so, it 
is kind of a one-stop shop and you can try to connect up with 
what else is going on in other States. You can see patterns. 
That has been particularly helpful.
    The one that--I hate to, as I say something nice about one 
agency, I have to criticize another, but the Federal 
Communications Commission should singularly be, let us say, 
complained about. The massive numbers of robocalls that 
penetrate onto our landline systems that they claim are an 
exercise of free speech really need to be stopped. I have 
testified in front of the FCC a number of times. They continue 
to tell me that it is free speech to blast literally millions 
of robocalls to the citizens of Indiana. It is three violations 
of our statute to do that.
    The FCC is the only agency that can prevent these calls, 
and they have steadfastly refused. I have threatened to hire my 
own robocaller to call each of their landline numbers with a 
few thoughts from our Hoosier--but, it is really--the FCC is 
remarkably bad in terms of helping the States where we really 
need their help.
    Congressman Carson. That is it.
    Senator Donnelly. Thank you, Mr. Attorney General.
    I want to say that one of the greatest things, I think, the 
Attorney General's office ever did--it may not have been the 
most critical to our legal history as our State, but, I think, 
to the lives of the people who live here, the ``do not call'' 
list was something that was extraordinary. I actually got to 
finish dinner without having phone calls occur.
    Congressman Carson. That is right.
    Mr. Zoeller. We are losing a little bit of the war, though, 
and it is the FCC that can stop that.
    Senator Donnelly. Understood. One of the things I want to 
emphasize, again, is to never, ever, ever give out your Social 
Security numbers or your credit card numbers or your banking 
information to someone who is calling you. I think our media--
all of you have done a terrific job of disseminating 
information, putting it out there. The more our media can 
through, whether it is Public Service Announcements or in the 
paper, talk about these kind of things so that someone who is 
at home in Terra Haute or in Richmond or in Sullivan can look 
and go, ``I just got a call on that yesterday.'' The more we 
know, the more information we have, the better armed we are.
    I would just like to ask this final question, which is 
this. If you had one recommendation that you could give to try 
to help with this situation or to tell others, if there is one 
thing you could say, what would it be? I will just go down the 
line. Ms. Walker.
    Ms. Walker. I would like to see the police departments 
better equipped. My mother and I went--first, it was just phone 
harassment at first, and there was no money involved, and they 
did not point us in--like, I never heard of your organization 
down there. They need to point us in who do we go to. We felt 
pretty--I felt pretty helpless that day.
    Senator Donnelly. Okay. Mr. Attorney General.
    Mr. Zoeller. I think I would come back to, in terms of the 
Federal Government's role, you really need to look at the 
growing distinction in privacy policies. This will always haunt 
the United States so long as companies are allowed to collect 
and maintain mega-data with literally no vulnerability other 
than States suing them for data breaches. They make a lot of 
money selling this information, but there ought to be a lot of 
raised responsibilities, and, I think, more and more, those 
companies need to think about whether they have higher duties 
when they collect and maintain information. If they do not need 
it, if it is not that vital, they should not be collecting it, 
and people should all be told how much information is being 
collected.
    Senator Donnelly. Inspector Mormon.
    Ms. Mormon. Yes. I think it is very important for us to 
reach out to our loved ones, so not just educating our older 
Americans, but we need to reach out to our parents, our 
families, our friends, and check on them when you go visit 
them. Look at their mail. Look at their calling histories on 
their phones. Check to see, as Ms. Walker did, about checks 
that are being written, and, if they do not report it, then at 
least you can contact the Postal Inspection Service and get 
some direction on how to handle that particular fraud or 
scheme, but, definitely, check up on your loved ones.
    Senator Donnelly. Mr. Moyo.
    Mr. Moyo. I think for us, as AARP, I think the biggest 
thing is that we want folks to share their stories. I think 
there is power in being able to hear from what is happening, 
and, I think the folks that are in charge of persecuting those 
issues, if they do not know what is out there and the folks are 
keeping it to themselves or feeling ashamed about sharing their 
story--I want to commend Ms. Walker for being here today to 
share her story, because I think that is where the power comes 
from, and folks like the Attorney General and the Inspector 
General are able to know what to be on the lookout for. I think 
if more and more people are willing to share their story, that 
is where the power will come from in terms of fighting some of 
these issues that we have today.
    Senator Donnelly. Mr. Lindenlaub.
    Mr. Lindenlaub. I would agree that knowledge is power, and 
the more knowledge we can get out in the communities on how 
these schemes work, the more--better prepared people are to 
defend themselves. In Indiana, we are pretty familiar with the 
2-1-1 system, if you want to call and get some information, 
much less familiar, apparently, with the ADRCs, which do cover 
the State and actually are nationwide. That is a great network 
for specialized resource information. We need to do a better 
job of getting that information out and making sure people feel 
comfortable giving us a call.
    Senator Donnelly. Thank you.
    To my colleague, Congressman Carson, thank you so much for 
your presence here today----
    Congressman Carson. Thank you, Senator. Thank you, friend.
    Senator Donnelly [continuing]. for your advocacy on behalf 
of our seniors and all the people of your district and our 
State.
    To all our witnesses, thank you. It is extraordinary to see 
people who are so dedicated to standing up and fighting for our 
seniors and for the people of our State.
    To all the scammers out there, know that there are people 
on the other side who are pushing back, who, if you are going 
to do this, we are going to work hard to prosecute you. We are 
going to work hard to expose the schemes out there.
    To our seniors, please be careful. When in doubt, call. 
Call our office. Call the office of the Attorney General. Call 
the office of Postal Inspection. Contact your AARP folks. Call 
Ms. Walker at her house.
    We will have to put in another line for you, Ms. Walker.
    We want to be of help. We want to be a team that stands up 
for the people of Indiana.
    To all of you, thank you. Thank you for your hard work.
    This hearing has concluded.
    [Whereupon, at 12:09 p.m., the committee was adjourned.]     
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                                APPENDIX

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                      Prepared Witness Statements

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